[Federal Register Volume 63, Number 46 (Tuesday, March 10, 1998)]
[Rules and Regulations]
[Pages 11612-11618]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-6088]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[CC Docket 92-77; FCC 98-9]


Billed Party Preference for InterLATA 0+ Calls

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: The Commission adopted a combined Second Report and Order and 
Order on Reconsideration which amends the Commission's rules and 
policies governing the disclosure of rates that will be offered when an 
away-from-home caller dials a non-access code operator service followed 
by an interexchange number (0+ call). In the Report and Order, the 
Commission amends its rules to require operator services providers 
(OSPs) to disclose orally to such callers how to obtain the total cost 
of a call, before the call is connected. The Order also adopts rules 
governing the filing of OSP informational tariffs and adopts oral 
disclosure requirements with respect to interstate collect calls 
initiated by prison inmates. A carrier providing the latter service 
must orally inform the party to be billed for such a call of its 
identity and how to obtain its charges for a call before anyone may be 
billed for the call. The Commission's decision is intended to make 
consumers more informed of their right to receive such cost information 
at the point of purchase from long-distance carriers before a call is 
connected. In the Order on Reconsideration, the Commission denied 
petitions for reconsideration of its earlier decision in this 
proceeding concerning proprietary calling card practices of AT&T. That 
decision declined to adopt a ``0+ in the Public Domain'' proposal urged 
by AT&T competitors.

DATES: Effective July 1, 1998, except for the amendments to Sec. 64.703 
and Sec. 64.710 which become effective October 1, 1999.

FOR FURTHER INFORMATION CONTACT: Adrien Auger, Enforcement Division, 
Common Carrier Bureau (202) 418-0960.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second 
Report and Order in CC Docket No. 92-77 [FCC 98-9], adopted on January 
29, 1998 and released on January 29, 1998. This Report and Order 
contains new or modified information collections subject to the 
Paperwork Reduction Act of 1995 (PRA). It has been submitted to the 
Office of Management and Budget (OMB) for review under the PRA. OMB, 
the general public, and other federal agencies are invited to comment 
on the proposed or modified information collections contained in this 
proceeding. The full text of the Second Report and Order and Order on 
Reconsideration is available for inspection and copying during normal 
business hours in the FCC Reference Center, Room 239, 1919 M Street, 
N.W., Washington, D.C. The complete text of this decision may also be 
purchased from the Commission's duplicating contractor, International 
Transcription Services, 1231 20th Street, N.W., Washington, D.C.

SUMMARY OF SECOND REPORT AND ORDER

I. Background

    1. The Commission has long been concerned about consumer 
dissatisfaction over high charges and certain practices of many OSPs 
for calls from public phones at away-from-home aggregator locations. In 
1990, Congress responded to such consumer concerns by providing the 
Commission and consumers with additional tools to address abusive 
practices, through the passage of the Telephone Operator Consumer 
Services Improvement Act of 1990 (TOCSIA or Section 226 of the 
Communications Act.) Under TOCSIA, an aggregator must, among other 
things, allow consumers the option of using an OSP of their choice by 
dialing an 800 or other number to reach that OSP, rather than having to 
use the particular OSP the aggregator has selected as its preferred or 
presubscribed interexchange carrier (PIC) for long-

[[Page 11613]]

 distance calls. Further, under TOCSIA, OSPs are required to file and 
maintain tariffs informing consumers of, not only their interstate 
charges, but also any applicable premises-imposed fee (PIF) or 
aggregator surcharge collected by the OSP or permitted in an OSP's 
contracts with aggregators.
    2. The Commission initiated Phase I of the instant proceeding in 
May, 1992 to examine alleged competitive inequities arising from AT&T's 
issuance of its proprietary card and short term proposals by many of 
AT&T's competitors to restrict the use of its proprietary carrier card 
with 0+ access. At the same time, the Commission also initiated an 
investigation of long term issues related to certain interexchange 
carrier (IXC) calling card practices, including a billed party 
preference (BPP) routing system for all 0+ interLATA calls (Phase II). 
In November, 1992, the Commission released a Report and Order with 
respect to Phase I of this proceeding, declining to adopt a ``0+ in the 
public domain'' proposal or other alternative interim remedies 
proffered by AT&T's competitors. In Phase II, the Commission addressed 
on a generic basis, the continuing complaints and concerns over the 
high level of charges billed consumers by many OSPs.
    3. On February 8, 1996, the Telecommunications Act of 1996 (1996 
Act) was enacted. The goal of the 1996 Act is to establish ``a pro-
competitive, de-regulatory national policy framework'' in order to make 
available to all Americans advanced telecommunications and information 
technologies and services ``by opening all telecommunications markets 
to competition.'' The 1996 Act requires that the Commission forbear 
from applying any provision of the Communications Act, or any of the 
Commission's regulations, to a telecommunications carrier or 
telecommunications service, or class thereof, if the Commission makes 
certain specified findings with respect to such provisions or 
regulations.
    4. On June 6, 1996, the Commission released a Second Further Notice 
of Proposed Rulemaking in the instant proceeding seeking comment on 
whether, under the 1996 Act, it should forbear from applying the 
informational tariff filing requirements of section 226 of the 
Communications Act. The Commission also sought comment on whether to 
require all OSPs to disclose their rates on all 0+ calls. 
Alternatively, the Commission sought comment on a tentative conclusion 
that it should: (1) Establish benchmarks for OSPs' consumer rates and 
associated charges that reflect what consumers expect to pay and (2) 
require OSPs that charge rates and/or allow related premises-imposed 
fees whose total is greater than a given percentage above a composite 
of the 0+ rates charged by the three largest interstate, interexchange 
carriers to disclose the applicable charges for the call to consumers 
orally before connecting a call. Further, with respect to collect calls 
initiated by prison inmates, the Commission sought comment on whether 
the public interest would be better served by some alternative to a 
billed party preference for routing operator service calls.

II. Discussion

    5. The Commission believes that adoption of the order will result 
in better informed consumers, foster a more competitive marketplace, 
and better serve the public interest than if it were to establish price 
controls or rate benchmarks. It also declined to implement a billed 
party preference (BPP) approach to the problem of high rates. It also 
denied petitions for reconsideration of its Phase I Order in this 
proceeding, where it declined to adopt, a 0+ in the public domain 
policy, in which OSPs would be entitled to access the calling card 
validation databases of all carriers.
    6. In the order the Commission also concluded that it should not, 
at this time, either waive or forebear from enforcing the requirement 
that OSPs file informational tariffs pursuant to section 226 of the 
Communications Act. It amended its rules, however, to increase the 
usefulness of informational tariffs by requiring that such tariffs 
include specific rates expressed in dollars and cents as well as 
applicable per-call aggregator surcharges or other per-call fees, if 
any, that are collected from consumers.

III. Conclusion

    7. The Commission amended its rules to require OSPs to provide 
additional oral information to away-from-home callers, disclosing how 
to obtain the cost of a call, including any aggregator surcharge, for a 
non-access code operator service interstate call from that aggregator 
location, before such a call is connected. The consumer has an option 
to bypass receipt of such cost information. The Commission also amended 
its rules to require carriers providing interstate service to prison 
inmates to orally disclose their identity to the party to be billed for 
such calls and, if such party elects to receive rate quotes for the 
call, to orally disclose the charges for the call before connecting the 
call.

IV. Final Regulatory Flexibility Analysis

    8. As required by the Regulatory Flexibility Act (RFA), an Initial 
Regulatory Flexibility Analysis (IRFA) was incorporated in the OSP 
Reform Notice. The Commission sought written public comments on the 
proposals in the OSP Reform Notice, including on the IRFA. The 
Commission's Final Regulatory Flexibility Analysis (FRFA) in this Order 
conforms to the RFA, as amended by the Contract With America 
Advancement Act of 1996 (CWAAA), Public Law 104-121, 110 Stat. 847 
(1996). The Commission is issuing this Order to protect consumers from 
excessive charges in connection with interstate 0+ operator services 
for payphone and prison inmate calls by ensuring that they are aware of 
their right to ascertain the specific cost for such calls so that they 
may hang up before incurring any charge that they believe is excessive.

i. Need for and Objectives of this Report and Order and the Rules 
Adopted Herein

    9. In the 1996 Act, Congress sought to establish ``a pro-
competitive, de-regulatory national policy framework'' for the United 
States telecommunications industry. One of the principal goals of the 
telephony provisions of the 1996 Act is promoting increased competition 
in all telecommunications markets, including those that are already 
open to competition, particularly long-distance services markets.
    10. In this Second Report and Order, we adopt rules requiring 
carriers to orally disclose to consumers how to obtain the cost of 
operator services for interstate calls from aggregator locations and 
from prison inmate-only telephones. The objective of the rules adopted 
in this Order is to implement as quickly and effectively as possible 
the national telecommunications policies embodied in the 1996 Act and 
to promote the development of competitive, deregulated markets 
envisioned by Congress. In doing so, we are mindful of the balance that 
Congress struck between this goal of bringing the benefits of 
competition to all consumers and its concern for the impact of the 1996 
Act on small business entities.

ii. Summary of Significant Issues Raised by the Public Comments in 
Response to the IRFA

    11. In the OSP Reform Notice, the Commission performed an IRFA. In 
the IRFA, the Commission found that the rules it proposed to adopt in 
this

[[Page 11614]]

proceeding may have an impact on small business entities as defined by 
section 601(3) of the RFA. In addition, the IRFA solicited comment on 
alternatives to the proposed rules that would minimize the impact on 
small entities consistent with the objectives of this proceeding.

iii. Comments on the IRFA

    12. Only one comment specifically addressed the Commission's IRFA. 
ACTA, a national trade association representing interexchange carriers, 
strongly supports adoption of a price disclosure requirement for all 0+ 
calls to provide consumers with the information necessary to make 
informed choices, thus doing away with the need for alternative 
proposals setting benchmark rates to trigger oral disclosure 
requirements. ACTA asserts that adoption of the alternative benchmark 
proposal would lead to anti-competitive and discriminatory results and 
therefore does not comply with the RFA.
    13. In support thereof, ACTA asserts: that basing benchmarks on the 
rates of the three largest IXCs (the Big Three) is unsound because it 
ignores greater underlying costs borne by smaller carriers and economic 
disparities which exist between the Big Three carriers and all other 
OSPs; that the Big Three may recover their costs through cross-
subsidization and arbitrary cost allocations that are possible because 
of their multi-market operations, whereas small providers can only 
recover their costs directly through rates charged consumers; that 
because all or most small carriers will be required to make oral 
disclosures, the public will be conditioned to associate small 
providers with excessive rates; that OSPs will be forced to charge 
rates below the Big Three and below their own costs, plus a reasonable 
profit, to get consumers to use their services; that the benchmark 
proposal thus has a confiscatory effect; and, accordingly, the already 
competitively disadvantaged smaller OSPs will not be able to sustain 
themselves in the marketplace, contrary to broad general policies 
seeking greater participation by smaller companies in competing in the 
OSP market, and the more specific policy that the Commission must apply 
in its RFA analysis.
    14. Further, ACTA contends that proposed benchmark rate elements 
such as time of day and distance do not affect underlying costs, are 
contrary to the industry's growing reliance on nationwide flat rates, 
and are inappropriate and unduly burdensome on small businesses. 
Moreover, ACTA contends that the list of characteristics proposed by 
the Commission does not take into account actual costs necessary to 
compete in the OSP marketplace such as PIFs and commissions, further 
skewing the competitive environment adversely to small businesses. 
According to ACTA, a benchmark margin of two to three times that of the 
Big Three benchmark carriers is needed to cover differences in 
underlying costs, not the 15 percent margin on which the Commission 
sought comment. ACTA also contends that the proposed benchmark 
methodology provides the benchmark carriers with the opportunity to 
engage in anti-competitive conduct and predatory pricing.
    15. Although not specifically filing an IRFA analysis, other 
commenters oppose adoption of rules that would unduly burden small 
businesses. Cleartel/ConQuest assert, arguendo, that even if a rate 
benchmark could be justified on the basis of consumer expectations, any 
standard disclosure that only applies to the smaller OSPs, and not to 
the three largest, would be arbitrary and discriminatory, would place 
an uneven burden on smaller OSPs, and would stigmatize all carriers 
other than the big three for the traveling public. NTCA asserts that 
industry-wide mandated BPP deployment is not economically feasible and 
would adversely affect small and rural LECs.
Discussion
    16. We agree with ACTA's views in regard to our IRFA and have 
concluded that the minimum rules adopted herein are necessary to 
protect consumers and will not unduly burden small OSPs or other small 
business entities. Such rules will aid consumers, including small 
business entities, avoid incurring excessive charges for 0+ operator 
services. The rules also provide OSPs and potential OSP competitors, 
including small business firms, a level playing field in that they 
apply equally to all OSPs, and, unlike benchmark proposals, do not 
discriminate against smaller OSP companies. Further, we are terminating 
our inquiry into BPP as urged by NTCA on behalf of small and rural 
LECs. Moreover, as urged by many commenters, including small business 
entities, we have not adopted various benchmark proposals or other 
price control rules set forth in this proceeding. Based on the record 
in this proceeding, we conclude that, contrary to the initial tentative 
conclusion in OSP Reform Notice, for the Commission to engage in price 
regulation of OSPs' rates, including benchmark regulation, would 
involve micro-managing the rates of nondominant carriers, including 
hundreds of small business companies. Such regulation would be the 
antithesis of the deregulatory thrust of the Regulatory Flexibility Act 
and the 1996 Act.

iv. Description and Estimates of the Number of Small Entities to Which 
the Rules Will Apply

    17. The rules adopted require that hundreds of nondominant 
interexchange carriers implement certain information disclosure 
procedures regarding their rates, and any related fees of the owners of 
the premises where the telephone instrument is located. Small entities 
may feel some economic impact in additional message production, 
recording costs, and equipment retrofitting or replacement costs due to 
the policies and rules adopted. Small providers of operator services 
also may experience greater live operator costs initially until 
automated terminal equipment and network systems are modified to 
replace the need for intervention of live operators.
    18. For the purposes of this analysis, we examine the relevant 
definition of ``small entity'' or ``small business'' and apply this 
definition to identify those entities that may be affected by the rules 
adopted in this Second Report and Order. The RFA defines a ``small 
business'' to be the same as a ``small business concern'' under the 
Small Business Act, 15 U.S.C. 632, unless the Commission has developed 
one or more definitions that are appropriate to its activities. A 
``small business concern'' is one that: (1) Is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) meets 
any additional criteria established by the Small Business 
Administration (the SBA). The SBA has defined a small business for 
Standard Industrial Classification (SIC) category 4813 (Telephone 
Communications, Except Radiotelephone) to be small entities when they 
have fewer than 1,500 employees. We first discuss generally the total 
number of telephone companies falling within this SIC category. Then, 
we refine further those estimates and discuss the number of carriers 
falling within relevant subcategories.
    19. Total Number of Telephone Companies Affected. The United States 
Bureau of the Census (``the Census Bureau'') reports that, at the end 
of 1992, there were 3,497 firms engaged in providing telephone 
services, as defined therein, for at least one year. This number 
contains a variety of different categories of carriers, including local 
exchange carriers, interexchange

[[Page 11615]]

carriers, competitive access providers, cellular carriers, operator 
service providers, pay telephone operators, personal communications 
service (PCS) providers, covered specialized mobile radio (SMR) 
providers, and resellers. It seems certain that some of those 3,497 
telephone service firms may not qualify as small entities, small 
interexchange carriers, or resellers of interexchange services, because 
they are not ``independently owned and operated.'' For example, a PCS 
provider that is affiliated with an interexchange carrier having more 
than 1,500 employees would not meet the definition of a small business. 
It seems reasonable to conclude, therefore, that fewer than 3,497 
telephone service firms are small entity telephone service firms that 
may be affected by this Order.
    20. Wireline Carriers and Service Providers. The SBA has developed 
a definition of small entities for telecommunications companies other 
than radiotelephone (wireless) companies (Telephone Communications, 
Except Radiotelephone). The Census Bureau reports that there were 2,321 
such telephone companies in operation for at least one year at the end 
of 1992. According to the SBA's definition, a small business telephone 
company other than a radiotelephone company is one employing fewer than 
1,500 persons. All but 26 of the 2,321 non-radiotelephone companies 
listed by the Census Bureau, 2,295 companies were reported to have 
fewer than 1,000 employees. Thus, even if all 26 of those companies had 
more than 1500 employees, there would still be 2,295 non-radiotelephone 
companies that might qualify as small entities based on these 
employment statistics. Because it seems certain, however, that some of 
these carriers are not independently owned and operated, this figure 
necessarily overstates the actual number of non-radiotelephone 
companies that would qualify as ``small business concerns'' under the 
SBA's definition. Consequently, we estimate using this methodology that 
there are fewer than 2,295 small entity telephone communications 
companies (other than radiotelephone companies) that may be affected by 
the decisions and rules adopted in this Order.
    21. Interexchange Carriers. Neither the Commission nor the SBA has 
developed a definition of small entities specifically applicable to 
providers of interexchange services (IXCs). The closest applicable 
definition under SBA rules is for telephone communications companies 
other than radiotelephone (wireless) companies. The most reliable 
source of information regarding the number of interexchange carriers 
nationwide of which we are aware appears to be the data that the 
Commission collects annually in connection with the TRS Worksheet. 
According to our most recent data, 130 companies reported that they 
were engaged in the provision of interexchange services. Although it 
seems certain that some of these carriers are not independently owned 
and operated, or have more than 1,500 employees, we are unable at this 
time to estimate with greater precision the number of interexchange 
carriers that would qualify as small business concerns under SBA's 
definition. Consequently, we estimate that there are fewer than 130 
small entity interexchange carriers that may be affected by the 
decisions and rules adopted in this Order.
    22. Resellers. Neither the Commission nor SBA has developed a 
definition of small entities specifically applicable to resellers. The 
closest applicable definition under SBA rules is for all telephone 
communications companies. The most reliable source of information 
regarding the number of resellers nationwide of which we are aware 
appears to be the data that we collect annually in connection with the 
TRS Worksheet. According to our most recent data, 260 companies 
reported that they were engaged in the resale of telephone services. 
Although it seems certain that some of these carriers are not 
independently owned and operated, or have more than 1,500 employees, we 
are unable at this time to estimate with greater precision the number 
of resellers that would qualify as small business concerns under SBA's 
definition. Consequently, we estimate that there are fewer than 260 
small entity resellers that may be affected by the decisions and rules 
adopted in this Order.
    23. Operator Service Providers. Carriers engaged in providing 
interstate operator services from aggregator locations (OSPs) currently 
are required under section 226 of the Communications Act to file and 
maintain informational tariffs at the Commission. The number of such 
tariffs on file thus appears to be the most reliable source of 
information of which we are aware regarding the number of OSPs 
nationwide, including small business concerns, that will be affected by 
decisions and rules adopted in this Order. As of August 19, 1997, 
approximately 630 carriers had informational tariffs on file at the 
Commission. Although it seems certain that some of these carriers are 
not independently owned and operated, or have more than 1,500 
employees, we are unable at this time to estimate with greater 
precision the number of OSPs that would qualify as small business 
concerns under SBA's definition. Consequently, we estimate that there 
are fewer than 630 small entity OSPs that may be affected by the 
decisions and rules adopted in this Order.
    24. Local Exchange Carriers. Consistent with our prior practice, we 
shall continue to exclude small incumbent providers of local exchange 
services (LECs) from the definition of ``small entity'' and ``small 
business concerns'' for the purpose of this FRFA. Because any small 
incumbent LECs that may be subject to these rules are either dominant 
in their field of operations or are not independently owned and 
operated, consistent with our prior practice, they are excluded from 
the definition of ``small entity'' and ``small business concerns.'' 
Accordingly, our use of the terms ``small entities'' and ``small 
businesses'' does not encompass small incumbent LECs. Out of an 
abundance of caution, however, for regulatory flexibility analysis 
purposes, we will consider small incumbent LECs within this analysis 
and use the term ``small incumbent LECs'' to refer to any incumbent 
LECs that arguably might be defined by the SBA as ``small business 
concerns.''
    25. Neither the Commission nor the SBA has developed a definition 
of small LECs. The closest applicable definition under SBA rules is for 
telephone communications companies other than radiotelephone (wireless) 
companies (SIC 4813) (Telephone Communications, Except Radiotelephone) 
as previously detailed above. Our alternative method for estimation 
utilizes the data that we collect annually in connection with the TRS 
Worksheet. This data provides us with the most reliable source of 
information of which we are aware regarding the number of LECs 
nationwide. According to our most recent data, 1,347 companies reported 
that they were engaged in the provision of local exchange services. 
Although it seems certain that some of these carriers are not 
independently owned and operated, or have more than 1,500 employees, we 
are unable at this time to estimate with greater precision the number 
of incumbent LECs that would qualify as small business concerns under 
SBA's definition. Consequently, we estimate that there are fewer than 
1,347 small LECs (including small incumbent LECs) that may be affected 
by the rules adopted in this Order.
    26. In addition, the rules adopted in this Order may affect 
companies that analyze information contained in OSPs'

[[Page 11616]]

tariffs. The SBA has not developed a definition of small entities 
specifically applicable to companies that analyze tariff information. 
The closest applicable definition under SBA rules is for Information 
Retrieval Services (SIC Category 7375). The Census Bureau reports that, 
at the end of 1992, there were approximately 618 such firms classified 
as small entities. This number contains a variety of different types of 
companies, only some of which analyze tariff information. We are unable 
at this time to estimate with greater precision the number of such 
companies and those that would qualify as small business concerns under 
SBA's definition. Consequently, we estimate that there are fewer than 
618 such small entity companies that may be affected by the decisions 
and rules adopted in this Order.

v. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements

    27. The rules adopted require carriers to disclose audibly to 
consumers how to obtain the price of a call before it is connected. In 
this section of the FRFA, we analyze the projected reporting, 
recordkeeping, and other compliance requirements that may apply to 
small entities as a result of this Order. As a part of this discussion, 
we mention some of the types of skills that will be needed to meet the 
new requirements.
    28. Nondominant interexchange carriers, including small nondominant 
interexchange carriers, will be required to provide oral information to 
away-from-home callers, advising them how to obtain the cost of an 
interstate 0+ call, and similarly to disclose to the party to be billed 
for collect calls from telephones set aside for use by prison inmates 
how to obtain the cost of the call before they could be billed for such 
calls. This change in the manner of conducting their business may 
require the use of technical, operational, accounting, billing, and 
legal skills.

vi. Significant Alternatives and Steps Taken to Minimize Significant 
Economic Impact on a Substantial Number of Small Entities Consistent 
With Stated Objectives

    29. In this section, we describe the steps taken to minimize the 
economic impact of our decisions on small entities and small incumbent 
IXCs, including the significant alternatives considered and rejected. 
To the extent that any statement contained in this FRFA is perceived as 
creating ambiguity with respect to our rules or statements made in 
preceding sections of this Order, the rules and statements set forth in 
those preceding sections shall be controlling.
    30. We believe that our action requiring carriers to orally 
disclose how to obtain the price of their interstate 0+ operator 
services up front at the point of purchase will facilitate the 
development of increased competition in the interstate, domestic, 
interexchange market, thereby benefitting all consumers, some of which 
are small business entities. Specifically, we find that the rules 
adopted herein with respect to interstate, domestic, interexchange 0+ 
services will enhance competition among OSPs, promote competitive 
market conditions, and achieve other objectives that are in the public 
interest, including establishing market conditions that more closely 
resemble an unregulated environment. The decision not to require 
detariffing of OSP informational tariffs will also allow businesses, 
including small business entities, that audit and analyze information 
contained in tariffs to continue.
    31. We have rejected several alternatives to the additional oral 
disclosure requirements and rules adopted herein, including proposals 
(1) to establish a costly billed party preference system for 0+ calls 
from aggregator and prison locations; (2) to micro-manage nondominant 
carriers' prices for such calls, including proposals to cap rates, 
establish annual FCC benchmarks, and to require cost justification for 
rates that exceed such benchmarks; (3) requiring oral warnings to 
prospective consumers comparing a carrier's rates with lower rates of 
the largest carriers; and (4) mandating 0+ in the public domain. 
Rejection of these alternatives helps to ensure that small carriers 
will not be unnecessarily burdened. The rules adopted herein are 
applicable only to limited interexchange 0+ calls from payphones, or 
other aggregator locations, and from inmate phones in correctional 
institutions. They are not applicable to international calls, 
intrastate calls, and interstate 0+ calls made by callers from their 
regular home or business. The rules also are inapplicable to calls that 
are initiated by dialing an access code prefix, such as 10333 or 1-800-
877-8000, whereby callers may circumvent placing the call through the 
long-distance carrier that is presubscribed for that line.

vii. Report to Congress

    32. The Commission shall send a copy of this Final Regulatory 
Flexibility Act Analysis, along with this Second Report and Order, in a 
report to Congress pursuant to the Small Business Regulatory 
Enforcement Fairness Act of 1996, 5 U.S.C. 801(a)(1)(A).

V. Paperwork Reduction Act

    33. This Report and Order contains either a new or modified 
information collection. The Commission, as part of its continuing 
effort to reduce paperwork burdens, invites the general public and the 
Office of Management and Budget (OMB) to comment on the information 
collections contained in this Order, as required by the Paperwork 
Reduction Act of 1995, Public Law No. 104-12. Written comments by the 
public on the information collections are due 30 days after date of 
publication in the Federal Register. OMB notification of action is due 
May 11, 1998. Comments should address: (1) Whether the new or modified 
collection of information is necessary for the proper performance of 
the functions of the Commission, including whether the information 
shall practical utility; (b) the accuracy of the Commission's burden 
estimates; (c) ways to enhance the quality, utility, and clarity of the 
information collected; and (d) ways to minimize the burden of the 
collection of information on the respondents including the use of 
automated collection techniques or other forms of information 
technology.
    OMB Approval Number: 3060-0717.
    Title: Billed Party Preference for InterLATA 0+ Calls, CC Docket 
No. 92-77 (47 CFR Sections 64.703(a), 64.709, and 64.710).
    Form No.: N/A.
    Type of Review: Revised collection.
    Respondents: Businesses or other for profit.

----------------------------------------------------------------------------------------------------------------
                                                                                                        Total   
             Section/title                  No. of                 Est. time per response               annual  
                                           responses                                                    burden  
----------------------------------------------------------------------------------------------------------------
64.703(a)(4)..........................     617,000,000  6-8 secs...................................       13,711
64.709................................             330  50 hours...................................       16,500
64.710................................             570  4 hours....................................        2,280
----------------------------------------------------------------------------------------------------------------


[[Page 11617]]

    Total Annual Burden: 32,491 burden hours.
    Estimated Costs Per Respondents: $600.
    Needs and Uses: The Commission adopts rules to further the goals of 
47 U.S.C. Section 226: (1) To protect consumers from unfair and 
deceptive practices relating to their use of operator services for 
interstate calls; and (2) to ensure that consumers have the opportunity 
to make informed choices in making such calls. Pursuant to 
Sec. 64.703(a) operator service providers (OSPs) are required to 
disclose, audibly and distinctly to the consumer, at no charge and 
before connecting any interstate call, how to obtain rate quotations, 
including any applicable surcharges, if the call is to be placed 
through the carrier selected by the payphone or premises owner. Section 
64.709 codifies the requirements for OSPs to file informational tariffs 
with the Commission. Section 64.710 requires providers of interstate 
operator services to inmates at correctional institutions to identify 
themselves, audibly and distinctly, to the party to be billed for the 
call and also disclose immediately thereafter to that party how he or 
she, without having to hang up to dial a separate number, may obtain 
the charges for the call, before the carrier may connect, and bill for, 
a call.
    For further information contact: For additional information 
concerning the information collections contained in this Report and 
Order contact Judy Boley at 202-418-0214, or via the Internet at 
[email protected].

VI. Ordering Clauses

    34. Accordingly, it is ordered, pursuant to sections 1, 4(i), 4(j), 
10, 201-205, 215, 218, 226, and 254 of the Communications Act of 1934, 
as amended, 47 U.S.C. 151, 154(i), 154(j), 160, 201-205, 215, 218, 226, 
254, that the policies, rules, and requirements set forth herein are 
adopted.
    35. It is further ordered that 47 CFR Part 64, Subpart B is 
amended, effective July 1, 1998, except for Secs. 64.703(a)(4) and 
64.710 which become effective October 1, 1999.
    36. It is further ordered that the request by Intellicall, Inc., 
filed March 21, 1997, seeking exemption of its Ultratel payphones from 
the rules adopted herein is denied.
    37. It is further ordered that the Office of Public Affairs, 
Reference Operations Division, shall mail a copy of this Report and 
Order to the Chief Counsel for Advocacy of the Small Business 
Administration, in accordance with section 603(a) of the Regulatory 
Flexibility Act, 5 U.S.C. 603(a)(1981).

List of Subjects in 47 CFR Part 64

    Communications common carriers, Consumer protection, 
Telecommunications.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.

Rule Changes

    Part 64 of Title 47 of the Code of Federal Regulations is amended 
as follows:

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

    1. The authority citation for part 64 continues to read as follows:

    Authority: 47 U.S.C. 154, unless otherwise noted. Interpret or 
apply sections 201, 218, 226, 228, 48 Stat. 1070, as amended, 1077; 
47 U.S.C. 201, 218, 226, 228, unless otherwise noted.

    2. Section 64.703 is amended by removing the word ``and'' at the 
end of paragraph (a)(2), removing the ``.'' at the end of the paragraph 
(a)(3)(iii) and adding in its place ``; and'' and by adding new 
paragraph (a)(4) to read as follows:


Sec. 64.703  Consumer information.

    (a) * * *
    (4) Disclose, audibly and distinctly to the consumer, at no charge 
and before connecting any interstate, domestic, interexchange non-
access code operator service call, how to obtain the total cost of the 
call, including any aggregator surcharge, or the maximum possible total 
cost of the call, including any aggregator surcharge, before providing 
further oral advice to the consumer on how to proceed to make the call. 
The oral disclosure required in this subsection shall instruct 
consumers that they may obtain applicable rate and surcharge quotations 
either, at the option of the provider of operator services, by dialing 
no more than two digits or by remaining on the line.
    3. Section 64.709 is added to subpart G to read as follows:


Sec. 64.709  Informational tariffs.

    (a) Informational tariffs filed pursuant to 47 U.S.C. 226(h)(1)(A) 
shall contain specific rates expressed in dollars and cents for each 
interstate operator service of the carrier and shall also contain 
applicable per call aggregator surcharges or other per call fees, if 
any, collected from consumers by the carrier or any other entity.
    (b) Per call fees, if any, billed on behalf of aggregators or 
others, shall be specified in informational tariffs in dollars and 
cents.
    (c) In order to remove all doubt as to their proper application, 
all informational tariffs must contain clear and explicit explanatory 
statements regarding the rates, i.e., the tariffed price per unit of 
service, and the regulations governing the offering of service in that 
tariff.
    (d) Informational tariffs shall be accompanied by a cover letter, 
addressed to the Secretary of the Commission, explaining the purpose of 
the filing.
    (1) The original of the cover letter shall be submitted to the 
Secretary without attachments, along with FCC Form 159, and the 
appropriate fee to the Mellon Bank, Pittsburgh, Pennsylvania.
    (2) Copies of the cover letter and the attachments shall be 
submitted to the Secretary's Office, the Commission's contractor for 
public records duplication, and the Chief, Tariff and Price Analysis 
Branch, Competitive Pricing Division.
    (e) Any changes to the tariff shall be submitted under a new cover 
letter with a complete copy of the tariff, including changes.
    (1) Changes to a tariff shall be explained in the cover letter but 
need not be symbolized on the tariff pages.
    (2) Revised tariffs shall be filed pursuant to the procedures 
specified in Sec. 64.703(c).
    4. Section 64.710 is added to subpart G to read as follows:


Sec. 64.710  Operator services for prison inmate phones.

    (a) Each provider of inmate operator services shall:
    (1) Identify itself, audibly and distinctly, to the consumer before 
connecting any interstate, domestic, interexchange telephone call and 
disclose immediately thereafter how the consumer may obtain rate 
quotations, by dialing no more than two digits or remaining on the 
line, for the first minute of the call and for additional minutes, 
before providing further oral advice to the consumer how to proceed to 
make the call;
    (2) Permit the consumer to terminate the telephone call at no 
charge before the call is connected; and
    (3) Disclose immediately to the consumer, upon request and at no 
charge to the consumer--
    (i) The methods by which its rates or charges for the call will be 
collected; and
    (ii) The methods by which complaints concerning such rates, charges 
or collection practices will be resolved.
    (b) As used in this subpart:
    (1) Consumer means the party to be billed for any interstate, 
domestic,

[[Page 11618]]

interexchange call from an inmate telephone;
    (2) Inmate telephone means a telephone instrument set aside by 
authorities of a prison or other correctional institution for use by 
inmates.
    (3) Inmate operator services means any interstate 
telecommunications service initiated from an inmate telephone that 
includes, as a component, any automatic or live assistance to a 
consumer to arrange for billing or completion, or both, of an 
interstate telephone call through a method other than:
    (i) Automatic completion with billing to the telephone from which 
the call originated; or
    (ii) Completion through an access code used by the consumer, with 
billing to an account previously established with the carrier by the 
consumer;
    (4) Provider of inmate operator services means any common carrier 
that provides outbound interstate, domestic, interexchange operator 
services from inmate telephones.
[FR Doc. 98-6088 Filed 3-9-98; 8:45 am]
BILLING CODE 6712-01-P